Friday, March 12, 2010

Obamacare: It's The Wrong Bill at the Wrong Time

"Even if Democrats extract the votes to put ObamaCare over the top, it will at best be a Pyrrhic victory for them. Regardless of the outcome, this monstrosity might cost the Democrats the Congress this November, ruin the party for a long time and prematurely render Barack Obama a lame duck president for the rest of his term.

The real reason why ObamaCare is so unpopular is that it is proposing a giant expansion of the entitlement state precisely when this state everywhere is coming apart: here and abroad; at the federal level and the state; in the public sector and the private. Suggesting a giant government takeover of a sixth of the economy can't be a popular selling point in a country whose DNA has a programmed hostility to Big Government.

Even before President Obama rammed through his trillion-dollar-plus stimulus/bailout packages last year, there was a growing sentiment that the country's top priority ought to be tackling the entitlement programs whose liabilities are like a swelling aneurysm in the brain of the body politic waiting to rupture. The combined unfunded liabilities of Medicare and Social Security--the federal health care and the pension programs for the elderly--are $107 trillion, seven times the current GDP. Meanwhile, Medicaid, the joint federal-state health insurance program, is consuming on average 21% of state budgets, their single biggest ticket item even before ObamaCare dumps another 16 million people into the program, expanding the Medicaid population by 25%. Beyond that, state and local government have promised their employees a trillion dollars more in pension and other benefits than they have funds to deliver.

There are not enough taxpayers in the country or creditors in China capable of financing all these promises. Expanding this massive, multifarious entitlement state even more strikes most normal people as sheer lunacy--especially now that it is visibly coming apart at the seams."

23 Comments:

Obamacare and all government programs demand growth or inflation to fund the schemes. States, counties, and cities are cutting costs like crazy, clearly deflationary. Oh, and I read in the FOREIGN press that Illinois has been issuing IOUs like California, since October. If this is true, and something of this magnitude is hidden from view, what else may be hidden?

Does that include rural Americans, who benefit mightily from federal crop subsidies, rural highway subsidies, rural power subsidies, rural telephone subsidies, rural water system subisides, subsidized airports, subsidized rail service and dubious placements of military bases?

The most mollycoddled, knock-kneed, enfeebled people on Earth are rural Americans, unable to stand on their own two feet without constant and growing subsidies from urban dwellers.

Big government--is there any aspect of the agriculture sector not subisided regulated and assisted by the federal government?

How about the Department of Defense? That is the very picture of Big Goverment, with all its manifest ossified fat and calcified blubber.

It was then-Tx. Congressman LBJ, in the 1930-40s with FDR, who perfected the art of taking federal money to "develop" rural areas with subsidies and defense installations.

The practice has grown ever since, and we have created the Red State Socialist Empire, that stretches from Alaska, down through Montana, thought the heartland and into the Appalachia.

Want to balance the federal budget? How about every state gets back form the feds what they pay in?

Oh, now there's an idea never mentioned in R-Party circles. I wonder why.

I am for it. Each state gets back what it sends to DC, minus a small administration fee.

Founding Fathers weren’t on board with this scheme either when drafting/ratifying the constitution, hence, the senate with equal state representation no matter their size (population or pocketbook).

Au contraire, Ted.

Until the progressive movement swept the country in the early part of the 20th century, Senators were chosen by the state legislatures. This was, by design, to serve as a bulwark against the central governments' usurping the power of the states.

Each senator was beholden to the state legislators who had elected him and who, theoretically, were eager to hold on to their power. Democracy-mania cured that, however, and left us with the corrupt mess we have today.

Even if Democrats extract the votes to put ObamaCare over the top, it will at best be a Pyrrhic victory for them. Regardless of the outcome, this monstrosity might cost the Democrats the Congress this November, ruin the party for a long time and prematurely render Barack Obama a lame duck president for the rest of his term.

This crazy cradle to grave entitlement nation will keep moving forward until the interest rates become a more reasonable 8-15%. This will cause voters to cut the government programs and politicians to raise taxes.

The most mollycoddled, knock-kneed, enfeebled people on Earth are rural Americans, unable to stand on their own two feet without constant and growing subsidies from urban dwellers ... The Red State Socialist Empire will collapse. They will have the hardest time.

Change the record. Do you simply cut and paste this garbage from one post to another? Others have schooled you before about farm subsidies, yet, you are apparently resistant to information and reason.

Go ahead, get rid of all the farm subsidies, it's not going to topple your imagined "Red State Socialist Empire". In fact, most Red Staters will hardly notice:

Two-thirds of all farm subsidies are distributed to the wealthiest 10 percent of farmers. The U.S. Department of Agriculture reports that farmers on “large” and “very large” farms—the types that receive the bulk of the subsidies—report an aver­age household income of more than $135,000. Are these the “poor family farmers” lawmakers are talking about?

It gets worse: 78 farms received over $1 million in subsidies in 2002. The $110 million received by Riceland Foods that year was more than Washing­ton gave to every farmer in 12 states combined. Not to be outdone, a dozen Fortune 500 compa­nies—including John Hancock Mutual Life Insur­ance, Westvaco, Chevron, and Caterpillar—have pocketed farm subsidies as much as 510 times larger than the amount received by the median farmer. Farm subsidy checks are also sent to celeb­rity “hobby farmers” such as David Rockefeller, Ted Turner, Scottie Pippen, and former Enron CEO Ken Lay.

The average American farmer works from sun-up to sun-down and receives almost nothing in farm subsidies. I guess that means that the "most mollycoddled, knock-kneed, enfeebled people on Earth" are you and your family members.

Meanwhile, we're spending more on welfare for Benny and brodero's brood of inter-marrying cousins than we spend on defense:

Total means-tested welfare spending in FY 2008 amounted to around $16,800 for each poor person in the U.S.;however, some welfare spending goes to individuals who have low incomes but are not below the official povertyline (about $22,200 per year for a family of four). Typically, welfare benefits are received not just by the poor, butalso by persons who have incomes below 200 percent of the federal poverty level ($44,400 per year for a family offour). Around one-third of the U.S. population falls within this lower income range. On average, welfare spendingamounts to around $7,000 per year for each individual who is poor or who has an income below 200 percent of thepoverty level. This comes to $28,000 per year for each lower-income family of four.

Welfare spending has grown enormously since President Lyndon B. Johnson launched the War on Poverty. Welfarespending was 13 times greater in FY 2008, after adjusting for inflation, than it was when the War on Povertystarted in 1964. Means-tested welfare spending was 1.2 percent of the gross domestic product (GDP) when PresidentJohnson began the War on Poverty. In 2008, it reached 5 percent of GDP.

The tax becomes more and more similar to that enacted in 1913 with an exemption of 4k for a married couple and then 1 % for the first 20k of income. The average income was $1296. in 1913 so most did not pay income tax then.

Anonymous said: "If enacted, can this monstrosity be undone in November?"

It seems, even if the Republicans win the House and 60% of the Senate (which they haven't done since 1921), they'll need a Republican president to get it undone. I doubt that'll happen anytime soon, because Republicans are incompetent presenting their arguments.

House Speaker Nancy Pelosi forecast final passage of the overhaul in days. "It's going to be historic," she said...Pelosi spoke with reporters after a closed-door meeting of the Democratic rank and file, a session that she said left her feeling "very exhilarated" about the prospects of passing the legislation. "We stand ready to stay as long as necessary" to finish it, she said.

Far-reaching changes in the student loan industry, would be added to the legislation...House Democrats continued private meetings Friday to review elements of the still-emerging fix-it bill...it would provide additional assistance to lower-income families who are unable to afford insurance, help states that already provide above-average benefits under Medicaid, the state-federal health care program for the poor, as well as gradually close a gap in coverage under the Medicare prescription drug program.

Want to balance the federal budget? How about every state gets back form the feds what they pay in?

Oh, now there's an idea never mentioned in R-Party circles. I wonder why.

I am for it. Each state gets back what it sends to DC, minus a small administration fee.

We get a balanced budget.

What's the matter? Don't you like the progressive tax system that liberals like you love to worship? You can blame yourselves for advocating the progressive tax system that heavily taxes high earners in Blue states. Who do you think is going to pay for the bulk of ObamaCare if it passes? Not the Red States, suckers. Think about that the next time some liberal senator from California comes up with a great idea to expand some entitlement program.

Given feeble Republican responses and short attention spans, the Democrats know there's eight months before the November election to convince enough voters Obamacare is the best thing that happened to them since Social Security. Pelosi has said "you can't sell a pie without a pie."

Benny BND Cole said...Hey, I'll say it again: Let every state receive back from DC equal to what they send.

End of story, end of deficit.

Die, Red State Socialist Empire Die!

Better than balanced budget, it would mean legislative paralysis and cost containment. Rural areas would deal with it. They mostly get handouts as political buyoffs to go along with social engineering programs.

Once everyone is balanced out, think how hard it would be to increase spending. Some years, like 2002 and 2009, there would be actual forced reductions in spending.

If any federal tax rate has to be raised for a few states to cover some targeted benefit, most other states would resist. With the varying demographics of the states, crafting benefits to account for the increase would be difficult.

For example, homeowner bailouts for Nevada would probably require more than a little increase in tax rates. But other states aren't so bad off. Even those extended unemployment benefits fall unevenly, so many states would be facing tax increases without the corresponding benefit.

Would there have been a failed GM and Chrysler bailout if Michigan has faced cuts to cover those defaulted loans? How about AIG, Fannie, or Freddie? Probably not.

I really think folks like Paul Krugman would be screaming the most. At times of crisis, people would have to fall back on themselves instead of the federal government.

The Republicans rather than keeping afloat the free market Bush years abandoned any defense of those years, like rats fleeing a sinking ship, and subsequently became powerless spectators. All Republicans can hope for now is more bad economic policies to win in November. I stated before:

Bush inherited the worst stock market crash since the Great Depression, a recession, and 9/11. However, the Bush Administration turned the recession into one of the mildest in history, after the record 10-year economic expansion.

Over a five-year period in the mid-2000s, U.S. corporations had a record 20 consecutive quarters of double-digit earnings growth, two million houses a year were built, 16 million autos per year were sold, U.S. real GDP expanded an average of 3%, in spite of 6% annual current account deficits (which subtract from GDP).

The U.S. economy was most efficient, while Americans stocked-up with real assets and goods, and capital was built-up. It was one of the greatest periods of U.S. prosperity, and in a structural bear market that began in 2000.

The Bush Administration was adept minimizing the recession in 2008, until Lehman failed in Sep '08, which caused the economy to fall off a cliff. However, subsequent appropriate policy adjustments were implemented quickly.

Yet, the vast majority of people believe the Bush economy was almost a complete failure.